The gig economy is here. How do current regulations measure up?

A look at jobs and economic growth in the state of California

A selection of 101 California Influencers are answering questions critical to the state's future. This week's topic is jobs and economic growth.
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A selection of 101 California Influencers are answering questions critical to the state's future. This week's topic is jobs and economic growth.
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Note to readers: Each week through November 2019, a selection of our 101 California Influencers answers a question that is critical to California’s future. Topics include education, healthcare, environment, housing and economic growth.

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Is it the urban hipster who wants to make a few extra dollars on the weekend while finishing her screenplay before she starts graduate school in the fall? Or the single mother driving 50-60 hours a week for multiple ride-hailing companies along with a night-shift custodial job, doing all she can to make rent and keep a roof over her children’s heads?

When it comes to setting the rules that govern part-time workers in a rapidly changing gig economy, the answer depends on which type of driver you see in the front seat – a wage slave or an entrepreneur.

The topic that has roiled the state Capitol is this: Under what circumstances should a part-time worker be entitled to health care, overtime and other benefits often associated with full-time employment? Not surprisingly, our California Influencers see vastly different archetypes for a gig worker and therefore come to dramatically different conclusions.

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“The gig economy doesn’t have the dirty, dangerous factories of the Industrial Revolution, or child laborers or piece workers. But, make no mistake, this is economic innovation based on exploitation of labor,” said Assembly Speaker Anthony Rendon, one of several Influencers to support Assembly Bill 5, which would make it more difficult for businesses to classify workers as independent contractors rather than employees. “It is clear as the glass on your smartphone.”

Longtime Democratic consultant Catherine Lew also called for the passage of legislation to provide workplace benefits to larger numbers of part-time workers.

“So-called ‘gig’ workers are hard-working Californians struggling to make ends meet or support their families – they are not disposable technology or robotic parts that can be used and set aside like yesterday’s app,” Lew said. “We must level the playing field by updating outdated labor laws to require proper employee classifications and provide these new-tech workers the same protections other California workers have earned and deserve.”

Other Influencers warned that by eliminating flexible work hours and other non-traditional economic opportunities, the legislation would harm the workers that it is attempting to help.

“California has thrived creatively, economically and culturally because we attract top talent, encourage risk-taking and give people the flexibility and freedom to pursue their dreams on their own terms… everything from caterers and freelance writers to truck drivers and tech workers,” said Bay Area Council President Jim Wunderman. “As part-time workers and independent contractors, these Californians can be their own boss, set their own schedule, negotiate their own work agreements and pay, and decide for themselves how best to structure their work to fit their lives and lifestyles.”

Former Republican Congressman Tom Campbell argued that setting a more stringent law in California than under federal statute would severely harm the state’s economy.

“Let’s not further drive jobs to other states,” Campbell urged. “If a job is a contractor under federal law, it should be a contractor under California law as well. Then no state would have an advantage over us in offering people jobs.”

Assemblyman Chad Mayes (R-Yucca Valley) suggested that rules designed for a more traditional workplace are no longer workable, and that new terminology is necessary to craft more effective solutions.

“The first thing we must do is recognize that technology has and continues to fundamentally change work in the 21st century,” said Mayes. “We need to adopt new definitions and standards that reflect these changes rather than try to apply outdated concepts to this new reality.”

Other Influencers offered proposals that reflected this changing landscape, including portable benefits such as insurance and retirement plans that would accompany a worker from one job to another.

“Ensuring that part-time gig workers can secure such benefits – and retain them as they move between different jobs and employers –would help improve workers’ economic and financial security, increase mobility, and empower workers to pursue new and different employment opportunities,” said Assemblyman Jesse Gabriel (D-Los Angeles). “Providing reliable access to benefits… is an important step toward developing a regulatory regime that provides part-time gig workers with the flexibility they desire and the protections and benefits they deserve.”

“For millennials, low wage earners, and other workers that have been excluded from traditionally stable job markets, the gig economy is the new frontier of economic opportunity,” Mejia said. “California leaders should embrace the gig economy and its ability to provide vulnerable workers with the flexibility, freedom, and financial control they otherwise wouldn’t have over their lives.”

Dan Schnur, a veteran analyst and longtime participant in California politics, is director of the California Influencers series for McClatchy.

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